1. Field of the Invention
The present invention relates to a health and welfare benefit enrollment and billing system and method. While the invention is subject to a wide range of applications, it is especially suited for use in an employee/employer context and will be particularly described in that connection.
2. Description of the Related Art
All employers, regardless of size, who offer health and welfare benefits to their employees must enroll the employees in one or more benefit plans by having the employees fill out appropriate application forms for each benefit plan and by transmitting the completed application forms to the appropriate providers of such plans, must receive and pay bills for premiums and administrative fees charged by the plan providers, and must develop and transmit various information about each participating employee and his or her enrollment to the employee, the plan providers, and other interested parties. Even if an employer doesn't offer benefits in the form of a cafeteria or flexible benefit plan, employees must make choices about their benefits, such as whether to accept or "opt out" and whether to cover self only or to include one or more dependents. Furthermore, the characteristics, such as variable rates and amounts of coverage based on age and/or salary, of certain benefits, such as life and disability income insurance, must be individualized for each employee. If the benefit plan is a cafeteria or flexible benefit plan, then the choices and individual variation among employees is even greater. Such individual variations among participating employees makes it highly desirable, if not necessary, for enrollment forms to be customized for each employee on an individual basis.
Generally, employers have not computerized the process of enrolling employees in health and welfare benefit plans. Also, a growing number of employers utilize customized enrollment forms generated by outside consultants or service providers. While an increasing number of employers have computerized their payroll and/or human resource information systems, either internally or on an "out-sourced" basis, the information contained in and generated by these payroll and/or human resource information systems is not sufficient to generate the enrollment forms needed for health and welfare benefit plans. Further, such systems are not able to manage health and welfare benefit enrollment information, communicate the information to interested parties such as, for example, participating employees and plan providers, or produce the billings needed for each plan provider's premiums and/or fees. Such systems also fail to store and, therefore, are not able to retrieve certain information required to be reported to regulatory authorities such as, for example, the IRS and U.S. Department of Labor. Hence, separate systems are maintained for performing these functions, ordinarily with independent data entry (even where the same data is needed by more than one system) and the attendant opportunities for inconsistency and human errors.
All health and welfare benefit plan providers, regardless of size, must receive enrollment information and application forms from participating employees. This enrollment information, once collected, is used to record enrollment details to substantiate entitlement to the specific benefits selected and to generate billing of premiums and/or administrative fees payable by the employer.
Virtually all plan providers have computerized their systems for recording and maintaining enrollment and benefit entitlement information for participating employees. And, virtually all plan providers have computerized their systems for calculating premiums due and issuing bills to the employers of the participating employees. However, the current state of the art is for each plan provider to maintain two separate systems; one for enrollments and the other for billing. Although both systems utilize much of the same information, the information is entered separately (typically by keyboard entry) into each system. This time-consuming duplication of data entry is wasteful and also gives rise to inconsistencies of human error.
Furthermore, plan providers have not standardized their enrollment application forms, nor the information needed about participating employees and dependents. Thus, each plan provider uses its own application forms and has its own requirements for information needed to enroll employees and their dependents into a specific benefit plan, and employees are required to fill out several different forms, such as a medical insurance application form, a dental insurance application form, a life insurance application and/or beneficiary designation form, a disability insurance application form, with overlapping information. As a result, there is more time wasted by employers and employees to implement and administer health and welfare benefit plans. In addition to wasted time, there is more opportunity for human error by an employee providing inconsistent information on each form and the employer wastes even more time double checking the forms and distributing them to the appropriate plan providers. Information from each form is then keyed into different enrollment and separate billing systems by each plan provider, thereby multiplying time wasting duplication of effort and more opportunities for human error in the re-keying of information.